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Myntra sales cross Rs850 crore

Flipkart-owned Myntra recorded sales of over Rs850 crore during January, including gross sales from its unit Jabong, when Myntra holds its heavily advertised End of Reason sale, the online retailer generates significantly higher sales than parent firm Flipkart and rival Amazon India. The two months also see clearance sales at offline retailers.

Myntra sold goods worth more than Rs350 crore during the three-day End of Reason Sale, after a slower-than-usual start to the year. Including Jabong, gross sales were over Rs400 crore. E-commerce firms were at the time still recovering from the impact of demonetization. According to research and analytics firm Kala Gato in January, the entire e-commerce industry was down 15-20% from the usual monthly average. In other news, Myntra, which earlier had just one retail partner called Vector E-commerce Pvt. Ltd, has now added three new sellers on its platform. Vector E-Commerce reported revenue of Rs1,747 crore for the year ended March 2016, an increase of about 40% from the year-ago period, while Myntra Designs reported a revenue of Rs1,069 crore, compared with Rs773 crore a year earlier. The 38% increase in sales in the last fiscal year reflected a slowdown in growth for Myntra from the past two years, when its sales expanded by at least 75%.

The firm was forced to change its legal structure because of FDI laws announced in last March by India that allowed FDI in online marketplaces but capped the contribution of a single seller to 25% of the marketplace’s overall business. Alternatively, Myntra could have chosen to become a genuine marketplace but it has chosen the current structure as it allows it to control customer experience. In a marketplace, the quality of Myntra’s products and service would largely depend on third-party sellers.

 

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